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| þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
| o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
|
Delaware
(State of incorporation) |
95-3666267
(IRS employer identification number) |
| Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o | Smaller reporting company o | |||
| (Do not check if a smaller reporting company) |
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| Exhibit 10.60 | ||||||||
| Exhibit 31.1 | ||||||||
| Exhibit 31.2 | ||||||||
| Exhibit 32.1 | ||||||||
| Exhibit 32.2 | ||||||||
| EX-101 INSTANCE DOCUMENT | ||||||||
| EX-101 SCHEMA DOCUMENT | ||||||||
| EX-101 CALCULATION LINKBASE DOCUMENT | ||||||||
| EX-101 LABELS LINKBASE DOCUMENT | ||||||||
| EX-101 PRESENTATION LINKBASE DOCUMENT | ||||||||
2
| Item 1. Financial Statements | ||
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
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Total revenues
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$ | 1,139,033 | $ | 1,150,282 | $ | 501,003 | $ | 458,451 | ||||||||
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Homebuilding:
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Revenues
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$ | 1,133,846 | $ | 1,145,014 | $ | 498,821 | $ | 456,348 | ||||||||
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Construction and land costs
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(945,196 | ) | (1,082,343 | ) | (411,813 | ) | (414,575 | ) | ||||||||
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Selling, general and administrative expenses
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(233,795 | ) | (217,647 | ) | (78,602 | ) | (83,878 | ) | ||||||||
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Operating income (loss)
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(45,145 | ) | (154,976 | ) | 8,406 | (42,105 | ) | |||||||||
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Interest income
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1,628 | 6,410 | 603 | 1,131 | ||||||||||||
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Interest expense, net of amounts
capitalized/loss on early redemption
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(52,108 | ) | (35,502 | ) | (16,183 | ) | (15,379 | ) | ||||||||
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Equity in loss of unconsolidated joint ventures
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(4,679 | ) | (47,811 | ) | (1,947 | ) | (26,315 | ) | ||||||||
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Homebuilding pretax loss
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(100,304 | ) | (231,879 | ) | (9,121 | ) | (82,668 | ) | ||||||||
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Financial services:
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Revenues
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5,187 | 5,268 | 2,182 | 2,103 | ||||||||||||
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Expenses
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(2,639 | ) | (2,569 | ) | (754 | ) | (915 | ) | ||||||||
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Equity in income of unconsolidated joint venture
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5,946 | 8,977 | 996 | 4,432 | ||||||||||||
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Financial services pretax income
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8,494 | 11,676 | 2,424 | 5,620 | ||||||||||||
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Total pretax loss
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(91,810 | ) | (220,203 | ) | (6,697 | ) | (77,048 | ) | ||||||||
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Income tax benefit
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5,000 | 17,700 | 5,300 | 11,000 | ||||||||||||
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Net loss
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$ | (86,810 | ) | $ | (202,503 | ) | $ | (1,397 | ) | $ | (66,048 | ) | ||||
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Basic and diluted loss per share
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$ | (1.13 | ) | $ | (2.64 | ) | $ | (.02 | ) | $ | (.87 | ) | ||||
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Basic and diluted average shares outstanding
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76,866 | 76,656 | 76,909 | 76,329 | ||||||||||||
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Cash dividends declared per common share
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$ | .1875 | $ | .1875 | $ | .0625 | $ | .0625 | ||||||||
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3
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
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Assets
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Homebuilding:
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Cash and cash equivalents
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$ | 919,851 | $ | 1,174,715 | ||||
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Restricted cash
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116,384 | 114,292 | ||||||
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Receivables
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137,337 | 337,930 | ||||||
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Inventories
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1,721,468 | 1,501,394 | ||||||
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Investments in unconsolidated joint
ventures
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101,435 | 119,668 | ||||||
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Other assets
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150,610 | 154,566 | ||||||
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3,147,085 | 3,402,565 | ||||||
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Financial services
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29,367 | 33,424 | ||||||
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Total assets
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$ | 3,176,452 | $ | 3,435,989 | ||||
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Liabilities and stockholders’ equity
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Homebuilding:
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Accounts payable
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$ | 288,974 | $ | 340,977 | ||||
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Accrued expenses and other liabilities
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468,398 | 560,368 | ||||||
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Mortgages and notes payable
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1,800,919 | 1,820,370 | ||||||
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2,558,291 | 2,721,715 | ||||||
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Financial services
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4,711 | 7,050 | ||||||
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Common stock
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115,143 | 115,120 | ||||||
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Paid-in capital
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867,505 | 860,772 | ||||||
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Retained earnings
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705,218 | 806,443 | ||||||
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Accumulated other comprehensive loss
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(22,244 | ) | (22,244 | ) | ||||
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Grantor stock ownership trust, at cost
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(120,629 | ) | (122,017 | ) | ||||
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Treasury stock, at cost
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(931,543 | ) | (930,850 | ) | ||||
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Total stockholders’ equity
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613,450 | 707,224 | ||||||
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Total liabilities and stockholders’ equity
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$ | 3,176,452 | $ | 3,435,989 | ||||
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4
| Nine Months Ended August 31, | ||||||||
| 2010 | 2009 | |||||||
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Cash flows from operating activities:
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Net loss
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$ | (86,810 | ) | $ | (202,503 | ) | ||
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Adjustments to reconcile net loss to net cash provided (used) by
operating activities:
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Equity in (income) loss of unconsolidated joint ventures
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(1,267 | ) | 38,834 | |||||
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Distributions of earnings from unconsolidated joint ventures
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10,000 | 7,662 | ||||||
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Amortization of discounts and issuance costs
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1,605 | 1,111 | ||||||
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Depreciation and amortization
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2,628 | 4,243 | ||||||
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Loss on voluntary termination of revolving credit
facility/early redemption of debt
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1,802 | 976 | ||||||
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Tax benefits from stock-based compensation
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1,599 | 4,093 | ||||||
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Stock-based compensation expense
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5,975 | 2,218 | ||||||
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Inventory impairments and land option contract abandonments
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16,739 | 91,469 | ||||||
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Change in assets and liabilities:
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Receivables
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182,762 | 236,305 | ||||||
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Inventories
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(149,021 | ) | 170,070 | |||||
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Accounts payable, accrued expenses and other liabilities
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(147,323 | ) | (249,674 | ) | ||||
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Other, net
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(2,832 | ) | 8,413 | |||||
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Net cash provided (used) by operating activities
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(164,143 | ) | 113,217 | |||||
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Cash flows from investing activities:
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Investments in unconsolidated joint ventures, net
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(1,533 | ) | (19,971 | ) | ||||
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Purchases of property and equipment, net
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(642 | ) | (1,245 | ) | ||||
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Net cash used by investing activities
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(2,175 | ) | (21,216 | ) | ||||
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Cash flows from financing activities:
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Change in restricted cash
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(2,092 | ) | 11,224 | |||||
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Proceeds from issuance of senior notes
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— | 259,737 | ||||||
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Payment of senior notes issuance costs
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— | (4,294 | ) | |||||
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Repayment of senior and senior subordinated notes
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— | (453,105 | ) | |||||
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Payments on mortgages, land contracts and other loans
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(73,371 | ) | (78,983 | ) | ||||
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Issuance of common stock under employee stock plans
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1,609 | 2,196 | ||||||
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Excess tax benefit associated with exercise of stock options
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583 | — | ||||||
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Payments of cash dividends
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(14,415 | ) | (14,295 | ) | ||||
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Repurchases of common stock
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(350 | ) | (616 | ) | ||||
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Net cash used by financing activities
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(88,036 | ) | (278,136 | ) | ||||
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Net decrease in cash and cash equivalents
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(254,354 | ) | (186,135 | ) | ||||
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Cash and cash equivalents at beginning of period
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1,177,961 | 1,141,518 | ||||||
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Cash and cash equivalents at end of period
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$ | 923,607 | $ | 955,383 | ||||
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5
| 1. |
Basis of Presentation and Significant Accounting Policies
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The accompanying unaudited consolidated financial statements have been prepared in accordance
with accounting principles generally accepted in the United States for interim financial
information and the rules and regulations of the Securities and Exchange Commission (“SEC”).
Accordingly, certain information and footnote disclosures normally included in the annual
financial statements prepared in accordance with generally accepted accounting principles
(“GAAP”) have been condensed or omitted.
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In the opinion of KB Home (the “Company”), the accompanying unaudited consolidated financial
statements contain all adjustments (consisting only of normal recurring accruals) necessary to
present fairly the Company’s consolidated financial position as of August 31, 2010, the results
of its consolidated operations for the nine months and three months ended August 31, 2010 and
2009, and its consolidated cash flows for the nine months ended August 31, 2010 and 2009. The
results of consolidated operations for the nine months and three months ended August 31, 2010 are
not necessarily indicative of the results to be expected for the full year, due to seasonal
variations in operating results and other factors. The consolidated balance sheet at November
30, 2009 has been taken from the audited consolidated financial statements as of that date. These
unaudited consolidated financial statements should be read in conjunction with the audited
consolidated financial statements for the year ended November 30, 2009, which are contained in
the Company’s Annual Report on Form 10-K for that period.
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Use of Estimates
|
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The accompanying unaudited consolidated financial statements have been prepared in conformity
with GAAP and, therefore, include amounts based on informed estimates and judgments of
management. Actual results could differ from these estimates.
|
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Cash and Cash Equivalents and Restricted Cash
|
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The Company considers all highly liquid debt instruments and other short-term investments
purchased with an original maturity of three months or less to be cash equivalents. The majority
of the Company’s cash and cash equivalents were invested in money market accounts and U.S.
government securities. Restricted cash of $116.4 million at August 31, 2010 consisted of $91.6
million of cash deposited with various banks that is required as collateral for the Company’s
cash-collateralized letter of credit facilities (the “LOC Facilities”), and $24.8 million of cash
in a deposit account required as collateral for the mortgages and notes payable associated with a
multi-level residential building the Company is operating as a rental property.
|
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Restricted cash of $114.3 million at November 30, 2009 consisted solely of cash deposited in an
interest reserve account with the administrative agent of the Company’s unsecured revolving
credit facility (the “Credit Facility”) pursuant to the Credit Facility’s terms. The Credit
Facility was terminated effective March 31, 2010 and the cash deposited in the interest reserve
account was withdrawn.
|
||
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Loss per share
|
|
Basic loss per share is calculated by dividing the net loss by the average number of common shares outstanding for the period. Diluted loss per share is calculated by dividing the net loss
by the average number of common shares outstanding including all potentially dilutive shares
issuable under outstanding stock options. All outstanding stock options were excluded from the
diluted loss per share calculation for the three months and nine months ended August 31, 2010 and
2009 because the effect of their inclusion would be antidilutive, or would decrease the reported
loss per share.
|
||
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Comprehensive loss
|
|
The Company’s comprehensive loss was $1.4 million for the three months ended August 31, 2010 and
$66.0 million for the three months ended August 31, 2009. The Company’s comprehensive loss
was $86.8 million for the nine months ended August 31, 2010 and $202.5 million for the nine
months ended August 31, 2009. The accumulated balances of other comprehensive loss in the
consolidated balance sheets as of August 31, 2010 and November 30, 2009 are comprised solely
of adjustments recorded directly to accumulated other comprehensive loss in accordance with
Accounting Standards Codification Topic No. 715, “Compensation — Retirement Benefits” (“ASC
715”). ASC 715 requires an employer to
|
6
| 1. |
Basis of Presentation and Significant Accounting Policies (continued)
|
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recognize the funded status of defined postretirement benefit plans as an asset or liability on
the balance sheet and requires any unrecognized prior service costs and actuarial gains/losses to
be recognized in accumulated other comprehensive income (loss).
|
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Certain amounts in the consolidated financial statements of prior periods have been reclassified
to conform to the 2010 presentation.
|
| 2. |
Stock-Based Compensation
|
|
The Company adopted the fair value recognition provisions of Accounting Standards Codification
Topic No. 718, “Compensation — Stock Compensation” (“ASC 718”), using the modified prospective
transition method effective December 1, 2005. ASC 718 requires a public entity to measure
compensation cost associated with awards of equity instruments based on the grant-date fair value
of the awards over the requisite service period. ASC 718 requires public entities to initially
measure compensation cost associated with awards of liability instruments based on their current
fair value. The fair value of each such award is to be remeasured subsequently at each reporting
date through the settlement date. Changes in fair value during the requisite service period are
recognized as compensation cost over that period.
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Stock Options
|
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In accordance with ASC 718, the Company estimates the grant-date fair value of its stock options
using the Black-Scholes option-pricing model, which takes into account assumptions regarding the
dividend yield, the risk-free interest rate, the expected stock-price volatility and the expected
term of the stock options. The following table summarizes the stock options outstanding and stock
options exercisable as of August 31, 2010, as well as stock options activity during the nine
months then ended:
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| Weighted | ||||||||
| Average Exercise | ||||||||
| Options | Price | |||||||
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Options outstanding at beginning of period
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5,711,701 | $ | 27.39 | |||||
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Granted
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1,363,532 | 18.40 | ||||||
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Exercised
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(23,000 | ) | 13.95 | |||||
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Cancelled
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(274,683 | ) | 18.80 | |||||
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Options outstanding at end of period
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6,777,550 | 25.97 | ||||||
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Options exercisable at end of period
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4,568,939 | 30.39 | ||||||
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As of August 31, 2010, the weighted average remaining contractual life of stock options
outstanding and stock options exercisable was 7.7 years and 7.2 years, respectively. There was
$4.5 million of total unrecognized compensation cost related to unvested stock option awards as
of August 31, 2010. For the three months ended August 31, 2010 and 2009, stock-based
compensation expense associated with stock options totaled $1.4 million and $.5 million,
respectively. For the nine months ended August 31, 2010 and 2009, compensation expense
associated with stock options totaled $4.3 million and $1.4 million, respectively. The aggregate
intrinsic value of stock options outstanding and stock options exercisable were each less than
$.1 million as of August 31, 2010. (The intrinsic value of a stock option is the amount by which
the market value of a share of the underlying common stock exceeds the exercise price of the
stock option.)
On August 13, 2010, the Company consummated an exchange offer (the “Exchange Offer”) pursuant to which eligible employees of the Company had the opportunity to exchange their outstanding cash-settled stock appreciation rights (“SARs”) granted on October 2, 2008 and January 22, 2009 for non-qualified options to purchase shares of KB Home |
7
| 2. |
Stock-Based Compensation (continued)
|
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common stock granted under the KB Home 2010 Equity Incentive Plan (the “2010 Plan”). Each stock
option granted in exchange for a SAR had an exercise price equal to the SAR’s exercise price and
the same number of underlying shares, vesting schedule and expiration date as each such SAR. The
Exchange Offer did not include a re-pricing or any other changes impacting the value to the
employees. The Company conducted the Exchange Offer in an effort to reduce the overall degree of
variability in the expense recorded for employee equity-based compensation by replacing the SARs,
which are accounted for as liability instruments, with stock options, which are accounted for as
equity instruments.
|
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Pursuant to the Exchange Offer, 19 eligible employees returned to the Company a total of
1,116,030 SARs, and those SARs were cancelled on August 13, 2010 in exchange for corresponding
grants of stock options to 18 of those employees to purchase an aggregate of 1,073,737 shares of
KB Home common stock at $19.90 per share and one grant of stock options to one employee to
purchase 42,293 shares of KB Home common stock at $11.25 per share. The 1,116,030 stock options
granted pursuant to the Exchange Offer are included in the stock options granted total in the
above table.
|
||
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Other Stock-Based Awards
|
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From time to time, the Company grants restricted stock, phantom shares and SARs to various
employees. The Company recognized total compensation income of $5.3 million in the three months
ended August 31, 2010 and total compensation expense of $6.6 million in the three months ended
August 31, 2009 related to these stock-based awards. The Company recognized total compensation
income of $.4 million in the nine months ended August 31, 2010 and total compensation expense of
$13.5 million in the nine months ended August 31, 2009 related to these stock-based awards.
|
||
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Approval of the KB Home 2010 Equity Incentive Plan
|
|
At the Company’s Annual Meeting of Stockholders held on April 1, 2010, the Company’s stockholders
approved the 2010 Plan, authorizing, among other things, the issuance of up to 3,500,000 shares
of the Company’s common stock for grants of stock-based awards to employees, non-employee
directors and consultants of the Company. This pool of shares includes all of the shares that
were available for grant as of April 1, 2010 under the Company’s 2001 Stock Incentive Plan, and
no new awards may be made under the 2001 Stock Incentive Plan. Accordingly, as of April 1, 2010,
the 2010 Plan became the Company’s only active equity compensation plan. Under the 2010 Plan,
grants of stock options and other similar awards reduce the 2010 Plan’s share capacity on a
1-for-1 basis, and grants of restricted stock and other similar “full value” awards reduce the
2010 Plan’s share capacity on a 1.78-for-1 basis. In addition, subject to the 2010 Plan’s terms
and conditions, a stock-based award may also be granted under the 2010 Plan to replace an
outstanding award granted under another Company plan (subject to the terms of such other plan)
with terms substantially identical to those of the award being replaced. The 2010 Plan was filed
as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended February 28,
2010.
|
| 3. |
Segment Information
|
|
As of August 31, 2010, the Company had identified five reporting segments, comprised of four
homebuilding reporting segments and one financial services reporting segment, within its
consolidated operations in accordance with Accounting Standards Codification Topic No. 280,
“Segment Reporting.” As of August 31, 2010, the Company’s homebuilding reporting segments
conducted ongoing operations in the following states:
|
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West Coast: California
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Southwest: Arizona and Nevada
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Central: Colorado and Texas
|
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Southeast: Florida, Maryland, North Carolina, South Carolina and Virginia
|
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The Company’s homebuilding reporting segments are engaged in the acquisition and development of
land primarily for residential purposes and offer a wide variety of homes that are designed to
appeal to first-time, move-up and active adult homebuyers.
|
8
| 3. |
Segment Information (continued)
|
|
The Company’s homebuilding reporting segments were identified based primarily on similarities in
economic and geographic characteristics, product types, regulatory environments, methods used to
sell and construct homes and land acquisition characteristics. The Company evaluates segment
performance primarily based on segment pretax results.
|
|
The Company’s financial services reporting segment provides title and insurance services to the
Company’s homebuyers. This segment also provides mortgage banking services to the Company’s
homebuyers indirectly through KBA Mortgage, LLC (“KBA Mortgage”), an unconsolidated joint venture
with a subsidiary of Bank of America, N.A. The Company’s financial services reporting segment
conducts operations in the same markets as the Company’s homebuilding reporting segments.
|
|
The Company’s reporting segments follow the same accounting policies used for the Company’s
consolidated financial statements. Operational results of each segment are not necessarily
indicative of the results that would have occurred had the segment been an independent,
stand-alone entity during the periods presented, nor are they indicative of the results to be
expected in future periods.
|
|
The following tables present financial information relating to the Company’s reporting segments
(in thousands):
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
Revenues:
|
||||||||||||||||
|
West Coast
|
$ | 483,383 | $ | 495,249 | $ | 211,294 | $ | 205,071 | ||||||||
|
Southwest
|
149,364 | 149,214 | 55,914 | 52,768 | ||||||||||||
|
Central
|
314,786 | 277,444 | 140,035 | 116,689 | ||||||||||||
|
Southeast
|
186,313 | 223,107 | 91,578 | 81,820 | ||||||||||||
|
|
||||||||||||||||
|
Total homebuilding revenues
|
1,133,846 | 1,145,014 | 498,821 | 456,348 | ||||||||||||
|
Financial services
|
5,187 | 5,268 | 2,182 | 2,103 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total revenues
|
$ | 1,139,033 | $ | 1,150,282 | $ | 501,003 | $ | 458,451 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income (loss):
|
||||||||||||||||
|
West Coast
|
$ | 31,080 | $ | (49,573 | ) | $ | 15,024 | $ | 2,848 | |||||||
|
Southwest
|
(11,799 | ) | (31,113 | ) | (1,802 | ) | (5,167 | ) | ||||||||
|
Central
|
(3,666 | ) | (27,123 | ) | 5,441 | (16,610 | ) | |||||||||
|
Southeast
|
(42,114 | ) | (60,331 | ) | (10,853 | ) | (30,690 | ) | ||||||||
|
Corporate and other (a)
|
(73,805 | ) | (63,739 | ) | (16,931 | ) | (33,049 | ) | ||||||||
|
|
||||||||||||||||
|
Total homebuilding pretax loss
|
(100,304 | ) | (231,879 | ) | (9,121 | ) | (82,668 | ) | ||||||||
|
Financial services
|
8,494 | 11,676 | 2,424 | 5,620 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total pretax loss
|
$ | (91,810 | ) | $ | (220,203 | ) | $ | (6,697 | ) | $ | (77,048 | ) | ||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Equity in income (loss) of unconsolidated joint ventures:
|
||||||||||||||||
|
West Coast
|
$ | 877 | $ | (7,852 | ) | $ | 230 | $ | 188 | |||||||
|
Southwest
|
(6,457 | ) | (13,346 | ) | (2,177 | ) | (3,404 | ) | ||||||||
|
Central
|
— | 506 | — | — | ||||||||||||
|
Southeast
|
901 | (27,119 | ) | — | (23,099 | ) | ||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | (4,679 | ) | $ | (47,811 | ) | $ | (1,947 | ) | $ | (26,315 | ) | ||||
|
|
||||||||||||||||
| (a) |
Corporate and other includes corporate general and administrative expenses.
|
9
| 3. |
Segment Information (continued)
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
Inventory impairments:
|
||||||||||||||||
|
West Coast
|
$ | 2,630 | $ | 16,182 | $ | 1,434 | $ | 7,779 | ||||||||
|
Southwest
|
962 | 13,267 | — | — | ||||||||||||
|
Central
|
— | 16,286 | — | 14,669 | ||||||||||||
|
Southeast
|
4,677 | 7,193 | — | 333 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | 8,269 | $ | 52,928 | $ | 1,434 | $ | 22,781 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Land option contract abandonments:
|
||||||||||||||||
|
West Coast
|
$ | 722 | $ | 27,679 | $ | 722 | $ | — | ||||||||
|
Southwest
|
— | — | — | — | ||||||||||||
|
Central
|
6,340 | — | — | — | ||||||||||||
|
Southeast
|
1,408 | 10,862 | 1,221 | 1,708 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | 8,470 | $ | 38,541 | $ | 1,943 | $ | 1,708 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Joint venture impairments:
|
||||||||||||||||
|
West Coast
|
$ | — | $ | 7,190 | $ | — | $ | — | ||||||||
|
Southwest
|
— | 5,426 | — | — | ||||||||||||
|
Central
|
— | — | — | — | ||||||||||||
|
Southeast
|
— | 25,369 | — | 23,183 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | — | $ | 37,985 | $ | — | $ | 23,183 | ||||||||
|
|
||||||||||||||||
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
Assets:
|
||||||||
|
West Coast
|
$ | 970,457 | $ | 838,510 | ||||
|
Southwest
|
377,763 | 346,035 | ||||||
|
Central
|
349,750 | 357,688 | ||||||
|
Southeast
|
397,755 | 361,551 | ||||||
|
Corporate and other
|
1,051,360 | 1,498,781 | ||||||
|
|
||||||||
|
Total homebuilding assets
|
3,147,085 | 3,402,565 | ||||||
|
Financial services
|
29,367 | 33,424 | ||||||
|
|
||||||||
|
|
||||||||
|
Total assets
|
$ | 3,176,452 | $ | 3,435,989 | ||||
|
|
||||||||
|
|
||||||||
|
Investments in unconsolidated joint ventures:
|
||||||||
|
West Coast
|
$ | 38,694 | $ | 54,795 | ||||
|
Southwest
|
54,575 | 56,779 | ||||||
|
Central
|
— | — | ||||||
|
Southeast
|
8,166 | 8,094 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 101,435 | $ | 119,668 | ||||
|
|
||||||||
10
| 4. |
Financial Services
|
|
The following tables present financial information relating to the Company’s financial services
reporting segment (in thousands):
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
Revenues
|
||||||||||||||||
|
Interest income
|
$ | 4 | $ | 29 | $ | 2 | $ | 1 | ||||||||
|
Title services
|
736 | 740 | 350 | 292 | ||||||||||||
|
Insurance commissions
|
4,447 | 4,499 | 1,830 | 1,810 | ||||||||||||
|
|
||||||||||||||||
|
Total
|
5,187 | 5,268 | 2,182 | 2,103 | ||||||||||||
|
|
||||||||||||||||
|
Expenses
|
||||||||||||||||
|
General and administrative
|
(2,639 | ) | (2,569 | ) | (754 | ) | (915 | ) | ||||||||
|
|
||||||||||||||||
|
Operating income
|
2,548 | 2,699 | 1,428 | 1,188 | ||||||||||||
|
Equity in income of
unconsolidated
joint venture
|
5,946 | 8,977 | 996 | 4,432 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income
|
$ | 8,494 | $ | 11,676 | $ | 2,424 | $ | 5,620 | ||||||||
|
|
||||||||||||||||
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
Assets
|
||||||||
|
Cash and cash equivalents
|
$ | 3,756 | $ | 3,246 | ||||
|
Receivables
|
873 | 1,395 | ||||||
|
Investment in unconsolidated joint
venture
|
24,694 | 28,748 | ||||||
|
Other assets
|
44 | 35 | ||||||
|
|
||||||||
|
|
||||||||
|
Total assets
|
$ | 29,367 | $ | 33,424 | ||||
|
|
||||||||
|
|
||||||||
|
Liabilities
|
||||||||
|
Accounts payable and accrued expenses
|
$ | 4,711 | $ | 7,050 | ||||
|
|
||||||||
|
|
||||||||
|
Total liabilities
|
$ | 4,711 | $ | 7,050 | ||||
|
|
||||||||
| 5. |
Inventories
|
|
Inventories consisted of the following (in thousands):
|
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Homes, lots and improvements in production
|
$ | 1,282,013 | $ | 1,091,851 | ||||
|
|
||||||||
|
Land under development
|
439,455 | 409,543 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 1,721,468 | $ | 1,501,394 | ||||
|
|
||||||||
11
| 5. |
Inventories (continued)
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Capitalized interest at beginning of period
|
$ | 291,279 | $ | 361,619 | $ | 275,405 | $ | 355,401 | ||||||||
|
|
||||||||||||||||
|
Capitalized interest related to
consolidation of previously unconsolidated
joint ventures
|
9,914 | — | — | — | ||||||||||||
|
|
||||||||||||||||
|
Interest incurred (a)
|
91,907 | 88,168 | 30,001 | 30,891 | ||||||||||||
|
|
||||||||||||||||
|
Interest expensed (a)
|
(52,108 | ) | (35,502 | ) | (16,183 | ) | (15,379 | ) | ||||||||
|
|
||||||||||||||||
|
Interest amortized
|
(79,454 | ) | (78,832 | ) | (27,685 | ) | (35,460 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Capitalized interest at end of period (b)
|
$ | 261,538 | $ | 335,453 | $ | 261,538 | $ | 335,453 | ||||||||
|
|
||||||||||||||||
| (a) |
Amounts for the nine months ended August 31, 2010 include a total of $1.8 million of
debt issuance costs written off in connection with the Company’s voluntary reduction of the
aggregate commitment under the Credit Facility from $650.0 million to $200.0 million during
the first quarter of 2010 and the voluntary termination of the Credit Facility during the
second quarter of 2010. Amounts for the three months and nine months ended August 31, 2009
include a $1.0 million loss on the early redemption of debt.
|
|
| (b) |
Inventory impairment charges are recognized against all inventory costs of a community,
such as land, land improvements, costs of home construction and capitalized interest.
Capitalized interest amounts presented in the table reflect the gross amount of capitalized
interest because impairment charges recognized are not generally allocated to specific
components of inventory.
|
| 6. |
Inventory Impairments and Land Option Contract Abandonments
|
12
| 6. |
Inventory Impairments and Land Option Contract Abandonments (continued)
|
| 7. |
Fair Value Disclosures
|
| Level 1 |
Fair value determined based on quoted prices in active markets for identical assets or
liabilities.
|
||
| Level 2 |
Fair value determined using significant observable inputs, such as quoted prices for
similar assets or liabilities or quoted prices for identical or similar assets or
liabilities in markets that are not active, inputs other than quoted prices that are
observable for the asset or liability, or inputs that are derived principally from or
corroborated by observable market data, by correlation or other means.
|
||
| Level 3 |
Fair value determined using significant unobservable inputs, such as pricing models,
discounted cash flows, or similar techniques.
|
13
| 7. |
Fair Value Disclosures (continued)
|
| Fair Value Measurements Using | ||||||||||||||||||||
| Quoted | Significant | |||||||||||||||||||
| Prices in | Other | Significant | ||||||||||||||||||
| Nine Months | Active | Observable | Unobservable | |||||||||||||||||
| Ended | Markets | Inputs | Inputs | |||||||||||||||||
| Description | August 31, 2010 (a) | (Level 1) | (Level 2) | (Level 3) | Total Losses | |||||||||||||||
|
|
||||||||||||||||||||
|
Long-lived assets
held and used
|
$ | 6,609 | $ | — | $ | — | $ | 6,609 | $ | (8,269 | ) | |||||||||
|
|
||||||||||||||||||||
| (a) |
Amount represents the aggregate fair values for communities where the Company recognized
noncash inventory impairment charges during the period, as of the date that the fair value
measurements were made. The carrying value for these communities may have subsequently
increased or decreased from the fair value reflected due to activity that has occurred since
the measurement date.
|
| August 31, 2010 | November 30, 2009 | |||||||||||||||
| Carrying | Estimated | Carrying | Estimated | |||||||||||||
| Value | Fair Value | Value | Fair Value | |||||||||||||
|
|
||||||||||||||||
|
Financial Liabilities:
|
||||||||||||||||
|
Senior notes due 2011 at 6 3/8%
|
$ | 99,886 | $ | 101,250 | $ | 99,800 | $ | 100,250 | ||||||||
|
Senior notes due 2014 at 5 3/4%
|
249,463 | 233,750 | 249,358 | 234,375 | ||||||||||||
|
Senior notes due 2015 at 5 7/8%
|
299,018 | 273,750 | 298,875 | 276,000 | ||||||||||||
|
Senior notes due 2015 at 6 1/4%
|
449,733 | 411,750 | 449,698 | 419,063 | ||||||||||||
|
Senior notes due 2017 at 9.1%
|
260,231 | 266,325 | 259,884 | 276,263 | ||||||||||||
|
Senior notes due 2018 at 7 1/4%
|
298,866 | 273,000 | 298,787 | 281,250 | ||||||||||||
14
| 8. |
Variable Interest Entities
|
15
| 8. |
Variable Interest Entities (continued)
|
| 9. |
Investments in Unconsolidated Joint Ventures
|
16
| 9. |
Investments in Unconsolidated Joint Ventures (continued)
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Revenues
|
$ | 110,455 | $ | 47,810 | $ | 10,376 | $ | 13,603 | ||||||||
|
Construction and land costs
|
(109,929 | ) | (100,911 | ) | (9,194 | ) | (50,540 | ) | ||||||||
|
Other expenses, net
|
(14,173 | ) | (39,216 | ) | (5,336 | ) | (16,123 | ) | ||||||||
|
|
||||||||||||||||
|
Loss
|
$ | (13,647 | ) | $ | (92,317 | ) | $ | (4,154 | ) | $ | (53,060 | ) | ||||
|
|
||||||||||||||||
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Assets
|
||||||||
|
Cash
|
$ | 13,251 | $ | 12,816 | ||||
|
Receivables
|
147,156 | 142,639 | ||||||
|
Inventories
|
574,996 | 709,130 | ||||||
|
Other assets
|
51,860 | 56,939 | ||||||
|
|
||||||||
|
|
||||||||
|
Total assets
|
$ | 787,263 | $ | 921,524 | ||||
|
|
||||||||
|
|
||||||||
|
Liabilities and equity
|
||||||||
|
Accounts payable and other liabilities
|
$ | 64,218 | $ | 94,533 | ||||
|
Mortgages and notes payable
|
374,434 | 514,172 | ||||||
|
Equity
|
348,611 | 312,819 | ||||||
|
|
||||||||
|
|
||||||||
|
Total liabilities and equity
|
$ | 787,263 | $ | 921,524 | ||||
|
|
||||||||
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Number of investments in unconsolidated joint ventures:
|
||||||||
|
With limited recourse debt (a)
|
1 | 2 | ||||||
|
With non-recourse debt (b)
|
— | 2 | ||||||
|
Other (c)
|
9 | 9 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
10 | 13 | ||||||
|
|
||||||||
17
| 9. |
Investments in Unconsolidated Joint Ventures (continued)
|
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Investments in unconsolidated joint ventures:
|
||||||||
|
With limited recourse debt
|
$ | — | $ | 1,277 | ||||
|
With non-recourse debt
|
— | 9,983 | ||||||
|
Other
|
101,435 | 108,408 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 101,435 | $ | 119,668 | ||||
|
|
||||||||
|
|
||||||||
|
Outstanding debt of unconsolidated joint ventures:
|
||||||||
|
With limited recourse debt
|
$ | 2,052 | $ | 11,198 | ||||
|
With non-recourse debt
|
— | 130,025 | ||||||
|
Other
|
372,382 | 372,949 | ||||||
|
|
||||||||
|
|
||||||||
|
Total (d)
|
$ | 374,434 | $ | 514,172 | ||||
|
|
||||||||
| (a) |
This category consists of unconsolidated joint ventures as to which the Company has
entered into a loan-to-value maintenance guaranty with respect to a portion of each such
unconsolidated joint venture’s outstanding secured debt.
|
|
| (b) |
This category consists of unconsolidated joint ventures as to which the Company does not
have a guaranty or any other obligation to repay or to support the value of the collateral
(which collateral includes any letters of credit) underlying such unconsolidated joint
ventures’ respective outstanding secured debt.
|
|
| (c) |
This category consists of unconsolidated joint ventures with no outstanding debt and an
unconsolidated joint venture as to which the Company has entered into a several guaranty.
This guaranty, by its terms, purports to require the Company to guarantee the repayment of a
portion of the unconsolidated joint venture’s outstanding debt in the event an involuntary
bankruptcy proceeding is filed against the unconsolidated joint venture that is not
dismissed within 60 days or for which an order approving relief under bankruptcy law is
entered, even if the unconsolidated joint venture or its partners do not collude in the
filing and the unconsolidated joint venture contests the filing, as further described below.
|
| (d) |
The “Total” amounts represent the aggregate outstanding debt of the unconsolidated joint
ventures in which the Company participates. These amounts do not represent the Company’s
potential responsibility for such debt, if any. In most cases, the Company’s maximum
potential responsibility for any portion of such debt, if any, is limited to either a
specified maximum amount or an amount equal to its pro rata interest in the relevant
unconsolidated joint venture, as further described below.
|
18
| 9. |
Investments in Unconsolidated Joint Ventures (continued)
|
19
| 9. |
Investments in Unconsolidated Joint Ventures (continued)
|
| 10. |
Mortgages and Notes Payable
|
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Mortgages and land contracts due to land sellers and other loans
|
$ | 143,722 | $ | 163,968 | ||||
|
Senior notes due 2011 at 6 3/8%
|
99,886 | 99,800 | ||||||
|
Senior notes due 2014 at 5 3/4%
|
249,463 | 249,358 | ||||||
|
Senior notes due 2015 at 5 7/8%
|
299,018 | 298,875 | ||||||
|
Senior notes due 2015 at 6 1/4%
|
449,733 | 449,698 | ||||||
|
Senior notes due 2017 at 9.1%
|
260,231 | 259,884 | ||||||
|
Senior notes due 2018 at 7 1/4%
|
298,866 | 298,787 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 1,800,919 | $ | 1,820,370 | ||||
|
|
||||||||
20
| 11. |
Commitments and Contingencies
|
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Balance at beginning of period
|
$ | 135,749 | $ | 145,369 | $ | 117,753 | $ | 137,690 | ||||||||
|
|
||||||||||||||||
|
Warranties issued
|
4,777 | 12,380 | 2,127 | 8,154 | ||||||||||||
|
|
||||||||||||||||
|
Payments and adjustments
|
(38,596 | ) | (17,945 | ) | (17,950 | ) | (6,040 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Balance at end of period
|
$ | 101,930 | $ | 139,804 | $ | 101,930 | $ | 139,804 | ||||||||
|
|
||||||||||||||||
21
| 11. |
Commitments and Contingencies (continued)
|
| 12. |
Legal Matters
|
22
| 12. |
Legal Matters (continued)
|
| 13. |
Stockholders’ Equity
|
| 14. |
Income Taxes
|
23
| 14. |
Income Taxes (continued)
|
| 15. |
Supplemental Disclosure to Consolidated Statements of Cash Flows
|
| Nine Months Ended August 31, | ||||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Summary of cash and cash equivalents at the end of the period:
|
||||||||
|
Homebuilding
|
$ | 919,851 | $ | 953,510 | ||||
|
Financial services
|
3,756 | 1,873 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 923,607 | $ | 955,383 | ||||
|
|
||||||||
|
|
||||||||
|
Supplemental disclosures of cash flow information:
|
||||||||
|
Interest paid, net of amounts capitalized
|
$ | 72,113 | $ | 67,833 | ||||
|
Income taxes paid
|
523 | 5,527 | ||||||
|
|
||||||||
|
Income taxes refunded
|
191,345 | 237,010 | ||||||
|
|
||||||||
24
| 15. |
Supplemental Disclosure to Consolidated Statements of Cash Flows (continued)
|
| Nine Months Ended August 31, | ||||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Supplemental disclosures of noncash activities:
|
||||||||
|
Increase in inventories in connection with consolidation of joint ventures
|
$ | 72,300 | $ | 97,550 | ||||
|
Increase in secured debt in connection with consolidation of joint ventures
|
— | 133,051 | ||||||
|
Increase in accounts payable, accrued expenses and other liabilities in
connection with consolidation of joint ventures
|
38,861 | — | ||||||
|
Stock appreciation rights exchanged for stock options
|
1,816 | — | ||||||
|
Cost of inventories acquired through seller financing
|
53,125 | 8,964 | ||||||
|
|
||||||||
|
Decrease in consolidated inventories not owned
|
(37,633 | ) | (40,374 | ) | ||||
|
|
||||||||
| 16. |
Supplemental Guarantor Information
|
25
| 16. |
Supplemental Guarantor Information (continued)
|
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 307,427 | $ | 831,606 | $ | — | $ | 1,139,033 | ||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 307,427 | $ | 826,419 | $ | — | $ | 1,133,846 | ||||||||||
|
Construction and land costs
|
— | (263,301 | ) | (681,895 | ) | — | (945,196 | ) | ||||||||||||
|
Selling, general and administrative expenses
|
(59,796 | ) | (41,940 | ) | (132,059 | ) | — | (233,795 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Operating income (loss)
|
(59,796 | ) | 2,186 | 12,465 | — | (45,145 | ) | |||||||||||||
|
Interest income
|
1,377 | 21 | 230 | — | 1,628 | |||||||||||||||
|
Interest expense, net of amounts
capitalized/loss on early
redemption
|
11,430 | (29,002 | ) | (34,536 | ) | — | (52,108 | ) | ||||||||||||
|
Equity in loss of unconsolidated joint
ventures
|
— | (148 | ) | (4,531 | ) | — | (4,679 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding pretax loss
|
(46,989 | ) | (26,943 | ) | (26,372 | ) | — | (100,304 | ) | |||||||||||
|
|
||||||||||||||||||||
|
Financial services pretax income
|
— | — | 8,494 | — | 8,494 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total pretax loss
|
(46,989 | ) | (26,943 | ) | (17,878 | ) | — | (91,810 | ) | |||||||||||
|
Income tax benefit
|
2,600 | 1,500 | 900 | — | 5,000 | |||||||||||||||
|
Equity in net loss of subsidiaries
|
(42,221 | ) | — | — | 42,221 | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net loss
|
$ | (86,610 | ) | $ | (25,443 | ) | $ | (16,978 | ) | $ | 42,221 | $ | (86,810 | ) | ||||||
|
|
||||||||||||||||||||
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 1,012,120 | $ | 138,162 | $ | — | $ | 1,150,282 | ||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 1,012,120 | $ | 132,894 | $ | — | $ | 1,145,014 | ||||||||||
|
Construction and land costs
|
— | (956,354 | ) | (125,989 | ) | — | (1,082,343 | ) | ||||||||||||
|
Selling, general and administrative expenses
|
(54,883 | ) | (134,632 | ) | (28,132 | ) | — | (217,647 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Operating loss
|
(54,883 | ) | (78,866 | ) | (21,227 | ) | — | (154,976 | ) | |||||||||||
|
Interest income
|
5,233 | 572 | 605 | — | 6,410 | |||||||||||||||
|
Interest expense, net of amounts
capitalized/loss on early
redemption
|
25,186 | (56,293 | ) | (4,395 | ) | — | (35,502 | ) | ||||||||||||
|
Equity in loss of unconsolidated joint ventures
|
— | (20,699 | ) | (27,112 | ) | — | (47,811 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding pretax loss
|
(24,464 | ) | (155,286 | ) | (52,129 | ) | — | (231,879 | ) | |||||||||||
|
|
||||||||||||||||||||
|
Financial services pretax income
|
— | — | 11,676 | — | 11,676 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total pretax loss
|
(24,464 | ) | (155,286 | ) | (40,453 | ) | — | (220,203 | ) | |||||||||||
|
Income tax benefit
|
2,000 | 12,400 | 3,300 | — | 17,700 | |||||||||||||||
|
Equity in net loss of subsidiaries
|
(180,039 | ) | — | — | 180,039 | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net loss
|
$ | (202,503 | ) | $ | (142,886 | ) | $ | (37,153 | ) | $ | 180,039 | $ | (202,503 | ) | ||||||
|
|
||||||||||||||||||||
26
| 16. |
Supplemental Guarantor Information (continued)
|
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 124,534 | $ | 376,469 | $ | — | $ | 501,003 | ||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 124,534 | $ | 374,287 | $ | — | $ | 498,821 | ||||||||||
|
Construction and land costs
|
— | (106,649 | ) | (305,164 | ) | — | (411,813 | ) | ||||||||||||
|
Selling, general and administrative expenses
|
(12,767 | ) | (13,731 | ) | (52,104 | ) | — | (78,602 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Operating income (loss)
|
(12,767 | ) | 4,154 | 17,019 | — | 8,406 | ||||||||||||||
|
Interest income
|
512 | 15 | 76 | — | 603 | |||||||||||||||
|
Interest expense, net of amounts
capitalized/loss on early
redemption
|
7,247 | (11,045 | ) | (12,385 | ) | — | (16,183 | ) | ||||||||||||
|
Equity in loss of unconsolidated joint ventures
|
— | (69 | ) | (1,878 | ) | — | (1,947 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding pretax income (loss)
|
(5,008 | ) | (6,945 | ) | 2,832 | — | (9,121 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
Financial services pretax income
|
— | — | 2,424 | — | 2,424 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total pretax income (loss)
|
(5,008 | ) | (6,945 | ) | 5,256 | — | (6,697 | ) | ||||||||||||
|
Income tax expense
|
3,900 | 5,500 | (4,100 | ) | — | 5,300 | ||||||||||||||
|
Equity in net loss of subsidiaries
|
(289 | ) | — | — | 289 | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net income (loss)
|
$ | (1,397 | ) | $ | (1,445 | ) | $ | 1,156 | $ | 289 | $ | (1,397 | ) | |||||||
|
|
||||||||||||||||||||
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 410,438 | $ | 48,013 | $ | — | $ | 458,451 | ||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Revenues
|
$ | — | $ | 410,438 | $ | 45,910 | $ | — | $ | 456,348 | ||||||||||
|
Construction and land costs
|
— | (372,539 | ) | (42,036 | ) | — | (414,575 | ) | ||||||||||||
|
Selling, general and administrative expenses
|
(27,834 | ) | (49,775 | ) | (6,269 | ) | — | (83,878 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Operating loss
|
(27,834 | ) | (11,876 | ) | (2,395 | ) | — | (42,105 | ) | |||||||||||
|
Interest income
|
887 | 155 | 89 | — | 1,131 | |||||||||||||||
|
Interest expense, net of amounts
capitalized/loss on early
redemption
|
4,487 | (17,098 | ) | (2,768 | ) | — | (15,379 | ) | ||||||||||||
|
Equity in loss of unconsolidated joint ventures
|
— | (3,218 | ) | (23,097 | ) | — | (26,315 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Homebuilding pretax loss
|
(22,460 | ) | (32,037 | ) | (28,171 | ) | — | (82,668 | ) | |||||||||||
|
|
||||||||||||||||||||
|
Financial services pretax income
|
— | — | 5,620 | — | 5,620 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total pretax loss
|
(22,460 | ) | (32,037 | ) | (22,551 | ) | — | (77,048 | ) | |||||||||||
|
Income tax benefit
|
3,200 | 4,600 | 3,200 | — | 11,000 | |||||||||||||||
|
Equity in net loss of subsidiaries
|
(46,788 | ) | — | — | 46,788 | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net loss
|
$ | (66,048 | ) | $ | (27,437 | ) | $ | (19,351 | ) | $ | 46,788 | $ | (66,048 | ) | ||||||
|
|
||||||||||||||||||||
27
| 16. |
Supplemental Guarantor Information (continued)
|
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Assets
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Cash and cash equivalents
|
$ | 776,617 | $ | 5,370 | $ | 137,864 | $ | — | $ | 919,851 | ||||||||||
|
Restricted cash
|
91,603 | 24,781 | — | — | 116,384 | |||||||||||||||
|
Receivables
|
9,560 | 12,855 | 114,922 | — | 137,337 | |||||||||||||||
|
Inventories
|
— | 738,737 | 982,731 | — | 1,721,468 | |||||||||||||||
|
Investments in unconsolidated joint ventures
|
— | 36,741 | 64,694 | — | 101,435 | |||||||||||||||
|
Other assets
|
66,669 | 73,537 | 10,404 | — | 150,610 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
944,449 | 892,021 | 1,310,615 | — | 3,147,085 | |||||||||||||||
|
|
||||||||||||||||||||
|
Financial services
|
— | — | 29,367 | — | 29,367 | |||||||||||||||
|
Investments in subsidiaries
|
25,797 | — | — | (25,797 | ) | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total assets
|
$ | 970,246 | $ | 892,021 | $ | 1,339,982 | $ | (25,797 | ) | $ | 3,176,452 | |||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Liabilities and stockholders’ equity
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Accounts payable, accrued expenses and
other liabilities
|
$ | 117,690 | $ | 190,439 | $ | 449,243 | $ | — | $ | 757,372 | ||||||||||
|
Mortgages and notes payable
|
1,657,197 | 139,586 | 4,136 | — | 1,800,919 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
1,774,887 | 330,025 | 453,379 | — | 2,558,291 | |||||||||||||||
|
|
||||||||||||||||||||
|
Financial services
|
— | — | 4,711 | — | 4,711 | |||||||||||||||
|
Intercompany
|
(1,418,091 | ) | 568,942 | 849,149 | — | — | ||||||||||||||
|
Stockholders’ equity
|
613,450 | (6,946 | ) | 32,743 | (25,797 | ) | 613,450 | |||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total liabilities and stockholders’ equity
|
$ | 970,246 | $ | 892,021 | $ | 1,339,982 | $ | (25,797 | ) | $ | 3,176,452 | |||||||||
|
|
||||||||||||||||||||
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Assets
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Cash and cash equivalents
|
$ | 995,122 | $ | 56,969 | $ | 122,624 | $ | — | $ | 1,174,715 | ||||||||||
|
Restricted cash
|
114,292 | — | — | — | 114,292 | |||||||||||||||
|
Receivables
|
191,747 | 109,536 | 36,647 | — | 337,930 | |||||||||||||||
|
Inventories
|
— | 1,374,617 | 126,777 | — | 1,501,394 | |||||||||||||||
|
Investments in unconsolidated joint ventures
|
— | 115,402 | 4,266 | — | 119,668 | |||||||||||||||
|
Other assets
|
68,895 | 85,856 | (185 | ) | — | 154,566 | ||||||||||||||
|
|
||||||||||||||||||||
|
|
1,370,056 | 1,742,380 | 290,129 | — | 3,402,565 | |||||||||||||||
|
|
||||||||||||||||||||
|
Financial services
|
— | — | 33,424 | — | 33,424 | |||||||||||||||
|
Investments in subsidiaries
|
35,955 | — | — | (35,955 | ) | — | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total assets
|
$ | 1,406,011 | $ | 1,742,380 | $ | 323,553 | $ | (35,955 | ) | $ | 3,435,989 | |||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Liabilities and stockholders’ equity
|
||||||||||||||||||||
|
Homebuilding:
|
||||||||||||||||||||
|
Accounts payable, accrued expenses and
other liabilities
|
$ | 147,264 | $ | 588,203 | $ | 165,878 | $ | — | $ | 901,345 | ||||||||||
|
Mortgages and notes payable
|
1,656,402 | 163,967 | 1 | — | 1,820,370 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
1,803,666 | 752,170 | 165,879 | — | 2,721,715 | |||||||||||||||
|
|
||||||||||||||||||||
|
Financial services
|
— | — | 7,050 | — | 7,050 | |||||||||||||||
|
Intercompany
|
(1,104,879 | ) | 990,210 | 114,669 | — | — | ||||||||||||||
|
Stockholders’ equity
|
707,224 | — | 35,955 | (35,955 | ) | 707,224 | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Total liabilities and stockholders’ equity
|
$ | 1,406,011 | $ | 1,742,380 | $ | 323,553 | $ | (35,955 | ) | $ | 3,435,989 | |||||||||
|
|
||||||||||||||||||||
28
| 16. |
Supplemental Guarantor Information (continued)
|
|
|
Condensed Consolidated Statements of Cash Flows
Nine Months Ended August 31, 2010 (in thousands) |
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from operating activities:
|
||||||||||||||||||||
|
Net loss
|
$ | (86,610 | ) | $ | (25,443 | ) | $ | (16,978 | ) | $ | 42,221 | $ | (86,810 | ) | ||||||
|
Adjustments to reconcile net loss to net cash provided
(used) by operating activities:
|
||||||||||||||||||||
|
Inventory impairments and land option contract
abandonments
|
— | 1,671 | 15,068 | — | 16,739 | |||||||||||||||
|
Changes in assets and liabilities:
|
||||||||||||||||||||
|
Receivables
|
182,187 | (3,027 | ) | 3,602 | — | 182,762 | ||||||||||||||
|
Inventories
|
— | (60,018 | ) | (89,003 | ) | — | (149,021 | ) | ||||||||||||
|
Accounts payable, accrued expenses and other liabilities
|
(27,757 | ) | (29,692 | ) | (89,874 | ) | — | (147,323 | ) | |||||||||||
|
Other, net
|
(7,304 | ) | 1,015 | 25,799 | — | 19,510 | ||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash provided (used) by operating activities
|
60,516 | (115,494 | ) | (151,386 | ) | 42,221 | (164,143 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from investing activities:
|
||||||||||||||||||||
|
Investments in unconsolidated joint ventures
|
— | (212 | ) | (1,321 | ) | — | (1,533 | ) | ||||||||||||
|
Purchases of property and equipment, net
|
(213 | ) | (63 | ) | (366 | ) | — | (642 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash used by investing activities
|
(213 | ) | (275 | ) | (1,687 | ) | — | (2,175 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from financing activities:
|
||||||||||||||||||||
|
Change in restricted cash
|
22,689 | (24,781 | ) | — | — | (2,092 | ) | |||||||||||||
|
Payments on mortgages, land contracts and other loans
|
— | (53,354 | ) | (20,017 | ) | — | (73,371 | ) | ||||||||||||
|
Issuance of common stock under employee stock plans
|
1,609 | — | — | — | 1,609 | |||||||||||||||
|
Excess tax benefit associated with exercise of stock
options
|
583 | — | — | — | 583 | |||||||||||||||
|
Payments of cash dividends
|
(14,415 | ) | — | — | — | (14,415 | ) | |||||||||||||
|
Repurchases of common stock
|
(350 | ) | — | — | — | (350 | ) | |||||||||||||
|
Intercompany
|
(288,924 | ) | 154,796 | 176,349 | (42,221 | ) | — | |||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash provided (used) by financing activities
|
(278,808 | ) | 76,661 | 156,332 | (42,221 | ) | (88,036 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net increase (decrease) in cash and cash equivalents
|
(218,505 | ) | (39,108 | ) | 3,259 | — | (254,354 | ) | ||||||||||||
|
Cash and cash equivalents at beginning of period
|
995,122 | 44,478 | 138,361 | — | 1,177,961 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash and cash equivalents at end of period
|
$ | 776,617 | $ | 5,370 | $ | 141,620 | $ | — | $ | 923,607 | ||||||||||
|
|
||||||||||||||||||||
29
| 16. |
Supplemental Guarantor Information (continued)
|
|
|
Condensed Consolidated Statements of Cash Flows
Nine Months Ended August 31, 2009 (in thousands) |
| KB Home | Guarantor | Non-Guarantor | Consolidating | |||||||||||||||||
| Corporate | Subsidiaries | Subsidiaries | Adjustments | Total | ||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from operating activities:
|
||||||||||||||||||||
|
Net loss
|
$ | (202,503 | ) | $ | (142,886 | ) | $ | (37,153 | ) | $ | 180,039 | $ | (202,503 | ) | ||||||
|
Adjustments to reconcile net loss to net cash provided
(used) by operating activities:
|
||||||||||||||||||||
|
Inventory impairments and land option contract
abandonments
|
— | 86,541 | 4,928 | — | 91,469 | |||||||||||||||
|
Changes in assets and liabilities:
|
||||||||||||||||||||
|
Receivables
|
214,861 | 30,894 | (9,450 | ) | — | 236,305 | ||||||||||||||
|
Inventories
|
— | (23,295 | ) | 193,365 | — | 170,070 | ||||||||||||||
|
Accounts payable, accrued expenses and other
liabilities
|
(82,054 | ) | (50,650 | ) | (116,970 | ) | — | (249,674 | ) | |||||||||||
|
Other, net
|
20,959 | 20,926 | 25,665 | — | 67,550 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash provided (used) by operating activities
|
(48,737 | ) | (78,470 | ) | 60,385 | 180,039 | 113,217 | |||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from investing activities:
|
||||||||||||||||||||
|
Investments in unconsolidated joint ventures
|
— | (14,811 | ) | (5,160 | ) | — | (19,971 | ) | ||||||||||||
|
Sales (purchases) of property and equipment, net
|
(65 | ) | (1,444 | ) | 264 | — | (1,245 | ) | ||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash used by investing activities
|
(65 | ) | (16,255 | ) | (4,896 | ) | — | (21,216 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash flows from financing activities:
|
||||||||||||||||||||
|
Change in restricted cash
|
11,224 | — | — | — | 11,224 | |||||||||||||||
|
Proceeds from issuance of senior notes
|
259,737 | — | — | — | 259,737 | |||||||||||||||
|
Payment of senior notes issuance costs
|
(4,294 | ) | — | — | — | (4,294 | ) | |||||||||||||
|
Repayment of senior and senior subordinated notes
|
(453,105 | ) | — | — | — | (453,105 | ) | |||||||||||||
|
Payments on mortgages, land contracts and other loans
|
— | (78,983 | ) | — | — | (78,983 | ) | |||||||||||||
|
Issuance of common stock under employee stock plans
|
2,196 | — | — | — | 2,196 | |||||||||||||||
|
Payments of cash dividends
|
(14,295 | ) | — | — | — | (14,295 | ) | |||||||||||||
|
Repurchases of common stock
|
(616 | ) | — | — | — | (616 | ) | |||||||||||||
|
Intercompany
|
79,902 | 169,685 | (69,548 | ) | (180,039 | ) | — | |||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net cash provided (used) by financing activities
|
(119,251 | ) | 90,702 | (69,548 | ) | (180,039 | ) | (278,136 | ) | |||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Net decrease in cash and cash equivalents
|
(168,053 | ) | (4,023 | ) | (14,059 | ) | — | (186,135 | ) | |||||||||||
|
Cash and cash equivalents at beginning of period
|
987,057 | 25,067 | 129,394 | — | 1,141,518 | |||||||||||||||
|
|
||||||||||||||||||||
|
|
||||||||||||||||||||
|
Cash and cash equivalents at end of period
|
$ | 819,004 | $ | 21,044 | $ | 115,335 | $ | — | $ | 955,383 | ||||||||||
|
|
||||||||||||||||||||
30
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
Revenues:
|
||||||||||||||||
|
Homebuilding
|
$ | 1,133,846 | $ | 1,145,014 | $ | 498,821 | $ | 456,348 | ||||||||
|
Financial services
|
5,187 | 5,268 | 2,182 | 2,103 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
$ | 1,139,033 | $ | 1,150,282 | $ | 501,003 | $ | 458,451 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income (loss):
|
||||||||||||||||
|
Homebuilding
|
$ | (100,304 | ) | $ | (231,879 | ) | $ | (9,121 | ) | $ | (82,668 | ) | ||||
|
Financial services
|
8,494 | 11,676 | 2,424 | 5,620 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total pretax loss
|
(91,810 | ) | (220,203 | ) | (6,697 | ) | (77,048 | ) | ||||||||
|
Income tax benefit
|
5,000 | 17,700 | 5,300 | 11,000 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Net loss
|
$ | (86,810 | ) | $ | (202,503 | ) | $ | (1,397 | ) | $ | (66,048 | ) | ||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Basic and diluted loss per share
|
$ | (1.13 | ) | $ | (2.64 | ) | $ | (.02 | ) | $ | (.87 | ) | ||||
|
|
||||||||||||||||
31
32
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
Revenues:
|
||||||||||||||||
|
Housing
|
$ | 1,129,477 | $ | 1,139,472 | $ | 496,898 | $ | 454,212 | ||||||||
|
Land
|
4,369 | 5,542 | 1,923 | 2,136 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
1,133,846 | 1,145,014 | 498,821 | 456,348 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Costs and expenses:
|
||||||||||||||||
|
Construction and land costs
|
||||||||||||||||
|
Housing
|
940,840 | 1,066,882 | 409,890 | 404,006 | ||||||||||||
|
Land
|
4,356 | 15,461 | 1,923 | 10,569 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
945,196 | 1,082,343 | 411,813 | 414,575 | ||||||||||||
|
Selling, general and administrative expenses
|
233,795 | 217,647 | 78,602 | 83,878 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total
|
1,178,991 | 1,299,990 | 490,415 | 498,453 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Operating income (loss)
|
$ | (45,145 | ) | $ | (154,976 | ) | $ | 8,406 | $ | (42,105 | ) | |||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Homes delivered
|
5,428 | 5,446 | 2,320 | 2,240 | ||||||||||||
|
Average selling price
|
$ | 208,100 | $ | 209,200 | $ | 214,200 | $ | 202,800 | ||||||||
|
Housing gross margin
|
16.7 | % | 6.4 | % | 17.5 | % | 11.1 | % | ||||||||
|
|
||||||||||||||||
|
Selling, general and administrative
expenses as a percentage of housing
revenues
|
20.7 | % | 19.1 | % | 15.8 | % | 18.5 | % | ||||||||
|
|
||||||||||||||||
|
Operating income (loss) as a percentage of
homebuilding revenues
|
-4.0 | % | -13.5 | % | 1.7 | % | -9.2 | % | ||||||||
33
| Three Months Ended August 31, | ||||||||||||||||||||||||
| Homes Delivered | Net Orders | Cancellation Rates | ||||||||||||||||||||||
| Segment | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||
|
West Coast
|
600 | 669 | 335 | 591 | 23 | % | 23 | % | ||||||||||||||||
|
Southwest
|
337 | 314 | 186 | 355 | 26 | 20 | ||||||||||||||||||
|
Central
|
855 | 783 | 556 | 808 | 37 | 28 | ||||||||||||||||||
|
Southeast
|
528 | 474 | 237 | 404 | 40 | 32 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Total
|
2,320 | 2,240 | 1,314 | 2,158 | 33 | % | 27 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||
|
Unconsolidated joint ventures
|
24 | 37 | 16 | 17 | — | % | 32 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||
| Nine Months Ended August 31, | ||||||||||||||||||||||||
| Homes Delivered | Net Orders | Cancellation Rates | ||||||||||||||||||||||
| Segment | 2010 | 2009 | 2010 | 2009 | 2010 | 2009 | ||||||||||||||||||
|
West Coast
|
1,440 | 1,589 | 1,372 | 1,978 | 18 | % | 21 | % | ||||||||||||||||
|
Southwest
|
912 | 822 | 850 | 936 | 18 | 21 | ||||||||||||||||||
|
Central
|
1,934 | 1,755 | 2,067 | 2,478 | 32 | 25 | ||||||||||||||||||
|
Southeast
|
1,142 | 1,280 | 1,182 | 1,503 | 28 | 28 | ||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Total
|
5,428 | 5,446 | 5,471 | 6,895 | 26 | % | 24 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||
|
Unconsolidated joint ventures
|
79 | 115 | 62 | 90 | 8 | % | 38 | % | ||||||||||||||||
|
|
||||||||||||||||||||||||
| August 31, | ||||||||||||||||
| Backlog - Value | ||||||||||||||||
| Backlog - Homes | (In Thousands) | |||||||||||||||
| Segment | 2010 | 2009 | 2010 | 2009 | ||||||||||||
|
West Coast
|
455 | 970 | $ | 165,546 | $ | 293,329 | ||||||||||
|
Southwest
|
220 | 462 | 34,490 | 75,439 | ||||||||||||
|
Central
|
1,052 | 1,444 | 171,577 | 218,430 | ||||||||||||
|
Southeast
|
442 | 846 | 83,703 | 146,896 | ||||||||||||
|
|
||||||||||||||||
|
Total
|
2,169 | 3,722 | $ | 455,316 | $ | 734,094 | ||||||||||
|
|
||||||||||||||||
|
Unconsolidated joint ventures
|
20 | 42 | $ | 7,480 | $ | 15,456 | ||||||||||
|
|
||||||||||||||||
34
35
36
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Housing revenues
|
$ | 1,129,477 | $ | 1,139,472 | $ | 496,898 | $ | 454,212 | ||||||||
|
Housing construction and land costs
|
(940,840 | ) | (1,066,882 | ) | (409,890 | ) | (404,006 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Housing gross margin
|
188,637 | 72,590 | 87,008 | 50,206 | ||||||||||||
|
Add: Inventory impairment and land
option contract abandonment
charges
|
16,739 | 81,674 | 3,377 | 16,034 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Housing gross margin, excluding
inventory impairment and land
option contract abandonment
charges
|
$ | 205,376 | $ | 154,264 | $ | 90,385 | $ | 66,240 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Housing
gross margin as a percentage of housing revenues
|
16.7 | % | 6.4 | % | 17.5 | % | 11.1 | % | ||||||||
|
|
||||||||||||||||
37
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Housing gross
margin, excluding
inventory
impairment and land
option contract
abandonment
charges, as a
percentage of
housing revenues
|
18.2 | % | 13.5 | % | 18.2 | % | 14.6 | % | ||||||||
|
|
||||||||||||||||
| August 31, | November 30, | |||||||
| 2010 | 2009 | |||||||
|
|
||||||||
|
Mortgages and notes payable
|
$ | 1,800,919 | $ | 1,820,370 | ||||
|
Stockholders’ equity
|
613,450 | 707,224 | ||||||
|
|
||||||||
|
|
||||||||
|
Total capital
|
$ | 2,414,369 | $ | 2,527,594 | ||||
|
|
||||||||
|
|
||||||||
|
Ratio of debt to total capital
|
74.6 | % | 72.0 | % | ||||
|
|
||||||||
|
|
||||||||
|
Mortgages and notes payable
|
$ | 1,800,919 | $ | 1,820,370 | ||||
|
Less: Cash and cash equivalents and restricted cash
|
(1,036,235 | ) | (1,289,007 | ) | ||||
|
|
||||||||
|
Net debt
|
764,684 | 531,363 | ||||||
|
Stockholders’ equity
|
613,450 | 707,224 | ||||||
|
|
||||||||
|
|
||||||||
|
Total capital
|
$ | 1,378,134 | $ | 1,238,587 | ||||
|
|
||||||||
|
|
||||||||
|
Ratio of net debt to total capital
|
55.5 | % | 42.9 | % | ||||
|
|
||||||||
38
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
West Coast:
|
||||||||||||||||
|
Revenues
|
$ | 483,383 | $ | 495,249 | $ | 211,294 | $ | 205,071 | ||||||||
|
Construction and land costs
|
(378,881 | ) | (466,599 | ) | (171,174 | ) | (176,889 | ) | ||||||||
|
Selling, general and administrative expenses
|
(50,556 | ) | (55,638 | ) | (17,824 | ) | (20,709 | ) | ||||||||
|
|
||||||||||||||||
|
Operating income (loss)
|
53,946 | (26,988 | ) | 22,296 | 7,473 | |||||||||||
|
Other, net
|
(22,866 | ) | (22,585 | ) | (7,272 | ) | (4,625 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income (loss)
|
$ | 31,080 | $ | (49,573 | ) | $ | 15,024 | $ | 2,848 | |||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Southwest:
|
||||||||||||||||
|
Revenues
|
$ | 149,364 | $ | 149,214 | $ | 55,914 | $ | 52,768 | ||||||||
|
Construction and land costs
|
(113,296 | ) | (139,570 | ) | (41,137 | ) | (44,197 | ) | ||||||||
|
Selling, general and administrative expenses
|
(35,316 | ) | (23,664 | ) | (12,584 | ) | (8,409 | ) | ||||||||
|
|
||||||||||||||||
|
Operating income (loss)
|
752 | (14,020 | ) | 2,193 | 162 | |||||||||||
|
Other, net
|
(12,551 | ) | (17,093 | ) | (3,995 | ) | (5,329 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax loss
|
$ | (11,799 | ) | $ | (31,113 | ) | $ | (1,802 | ) | $ | (5,167 | ) | ||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Central:
|
||||||||||||||||
|
Revenues
|
$ | 314,786 | $ | 277,444 | $ | 140,035 | $ | 116,689 | ||||||||
|
Construction and land costs
|
(264,088 | ) | (254,716 | ) | (114,397 | ) | (114,688 | ) | ||||||||
|
Selling, general and administrative expenses
|
(45,844 | ) | (42,154 | ) | (17,814 | ) | (15,450 | ) | ||||||||
|
|
||||||||||||||||
|
Operating income (loss)
|
4,854 | (19,426 | ) | 7,824 | (13,449 | ) | ||||||||||
|
Other, net
|
(8,520 | ) | (7,697 | ) | (2,383 | ) | (3,161 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income (loss)
|
$ | (3,666 | ) | $ | (27,123 | ) | $ | 5,441 | $ | (16,610 | ) | |||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Southeast:
|
||||||||||||||||
|
Revenues
|
$ | 186,313 | $ | 223,107 | $ | 91,578 | $ | 81,820 | ||||||||
|
Construction and land costs
|
(181,998 | ) | (214,452 | ) | (83,080 | ) | (76,138 | ) | ||||||||
|
Selling, general and administrative expenses
|
(32,649 | ) | (30,411 | ) | (14,894 | ) | (8,082 | ) | ||||||||
|
|
||||||||||||||||
|
Operating loss
|
(28,334 | ) | (21,756 | ) | (6,396 | ) | (2,400 | ) | ||||||||
|
Other, net
|
(13,780 | ) | (38,575 | ) | (4,457 | ) | (28,290 | ) | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax loss
|
$ | (42,114 | ) | $ | (60,331 | ) | $ | (10,853 | ) | $ | (30,690 | ) | ||||
|
|
||||||||||||||||
39
40
41
| Nine Months Ended August 31, | Three Months Ended August 31, | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
|
|
||||||||||||||||
|
Revenues
|
$ | 5,187 | $ | 5,268 | $ | 2,182 | $ | 2,103 | ||||||||
|
Expenses
|
(2,639 | ) | (2,569 | ) | (754 | ) | (915 | ) | ||||||||
|
Equity in income of
unconsolidated joint venture
|
5,946 | 8,977 | 996 | 4,432 | ||||||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Pretax income
|
$ | 8,494 | $ | 11,676 | $ | 2,424 | $ | 5,620 | ||||||||
|
|
||||||||||||||||
|
|
||||||||||||||||
|
Total originations (a):
|
||||||||||||||||
|
Loans
|
4,353 | 4,610 | 1,827 | 1,990 | ||||||||||||
|
Principal
|
$ | 810,609 | $ | 858,156 | $ | 347,372 | $ | 359,707 | ||||||||
|
Percentage of homebuyers
using KBA Mortgage
|
83 | % | 83 | % | 83 | % | 86 | % | ||||||||
|
|
||||||||||||||||
|
Loans sold to third parties (a):
|
||||||||||||||||
|
Loans
|
4,545 | 4,307 | 2,089 | 1,903 | ||||||||||||
|
Principal
|
$ | 826,756 | $ | 800,649 | $ | 386,619 | $ | 343,604 | ||||||||
| (a) |
Loan originations and sales occur within KBA Mortgage.
|
42
43
44
45
46
47
48
49
50
51
| Weighted Average | ||||||||
| Fiscal Year of Expected Maturity | Fixed Rate Debt | Interest Rate | ||||||
|
|
||||||||
|
2010
|
$ | — | — | % | ||||
|
2011
|
99,886 | 6.4 | ||||||
|
2012
|
— | — | ||||||
|
2013
|
— | — | ||||||
|
2014
|
249,463 | 5.8 | ||||||
|
Thereafter
|
1,307,848 | 7.0 | ||||||
|
|
||||||||
|
|
||||||||
|
Total
|
$ | 1,657,197 | 6.7 | % | ||||
|
|
||||||||
|
|
||||||||
|
Fair value at August 31, 2010
|
$ | 1,559,825 | ||||||
|
|
||||||||
52
53
| Exhibits | ||||
|
|
||||
| 10.58 | * |
Form of Stock Option Agreement under the KB Home 2010 Equity Incentive Plan, filed as an
exhibit to the Company’s Current Report on Form 8-K dated July 20, 2010, is incorporated by
reference herein.
|
||
|
|
||||
| 10.59 | * |
Form of Restricted Stock Agreement under the KB Home 2010 Equity Incentive Plan, filed as
an exhibit to the Company’s Current Report on Form 8-K dated July 20, 2010, is
incorporated by reference herein.
|
||
|
|
||||
| 10.60 | * |
Agreement, dated July 15, 2010, between the Company and Wendy C. Shiba.
|
||
|
|
||||
| 31.1 |
Certification of Jeffrey T. Mezger, President and Chief Executive Officer of KB Home
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 31.2 |
Certification of Jeff J. Kaminski, Executive Vice President and Chief Financial Officer
of KB Home Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 32.1 |
Certification of Jeffrey T. Mezger, President and Chief Executive Officer of KB Home
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
|||
|
|
||||
| 32.2 |
Certification of Jeff J. Kaminski, Executive Vice President and Chief Financial Officer
of KB Home Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 101 |
The following materials from KB Home’s Quarterly Report on Form 10-Q for the quarter
ended August 31, 2010, formatted in eXtensible Business Reporting Language (XBRL): (i)
Consolidated Statements of Operations, (ii) Consolidated Balance Sheets, (iii) Consolidated
Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements, tagged as
blocks of text. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on
Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus
for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not
filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and
otherwise are not subject to liability under those sections.
|
|||
| * |
Management contract or compensatory plan or arrangement in which executive officers are eligible
to participate.
|
54
|
KB HOME
Registrant |
||||
| Dated October 8, 2010 | By: | /s/ JEFF J. KAMINSKI | ||
| Jeff J. Kaminski | ||||
|
Executive Vice President and Chief Financial Officer
(Principal Financial Officer) |
||||
| Dated October 8, 2010 | By: | /s/ WILLIAM R. HOLLINGER | ||
| William R. Hollinger | ||||
|
Senior Vice President and Chief Accounting Officer
(Principal Accounting Officer) |
||||
55
|
|
||||
| 10.58 | * |
Form of Stock Option Agreement under the KB Home 2010 Equity Incentive Plan, filed as an
exhibit to the Company’s Current Report on Form 8-K dated July 20, 2010, is incorporated by
reference herein.
|
||
|
|
||||
| 10.59 | * |
Form of Restricted Stock Agreement under the KB Home 2010 Equity Incentive Plan, filed as
an exhibit to the Company’s Current Report on Form 8-K dated July 20, 2010, is
incorporated by reference herein.
|
||
|
|
||||
| 10.60 | * |
Agreement, dated July 15, 2010, between the Company and Wendy C. Shiba.
|
||
|
|
||||
| 31.1 |
Certification of Jeffrey T. Mezger, President and Chief Executive Officer of KB Home
Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 31.2 |
Certification of Jeff J. Kaminski, Executive Vice President and Chief Financial Officer
of KB Home Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 32.1 |
Certification of Jeffrey T. Mezger, President and Chief Executive Officer of KB Home
Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
|||
|
|
||||
| 32.2 |
Certification of Jeff J. Kaminski, Executive Vice President and Chief Financial Officer
of KB Home Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
|
|||
|
|
||||
| 101 |
The following materials from KB Home’s Quarterly Report on Form 10-Q for the quarter
ended August 31, 2010, formatted in eXtensible Business Reporting Language (XBRL): (i)
Consolidated Statements of Operations, (ii) Consolidated Balance Sheets, (iii) Consolidated
Statements of Cash Flows, and (iv) Notes to Consolidated Financial Statements, tagged as
blocks of text. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on
Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus
for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not
filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and
otherwise are not subject to liability under those sections.
|
| * |
Management contract or compensatory plan or arrangement in which executive officers are eligible
to participate.
|
56
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
No Customers Found
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|